(NC)-In the current environment, it's more important than ever for Canadians to find out if - and how - their savings are protected. Though it's rare for financial institutions in this country to fail or go bankrupt, it does happen. And that's why the Canada Deposit Insurance Corporation (CDIC) exists. CDIC is the federal government organization that protects your savings if there is a financial institution failure. It's important to understand how much of your savings are protected, what institutions are members of CDIC and what types of savings are protected in case there is a failure.
The first step to ensuring if your savings are protected is to determine if your financial institution is a member of CDIC. Member institutions include most chartered Canadian banks, loan companies and trust companies that take deposits, as well as associations governed by the Cooperative Credit Associations Act that take deposits. For a list of CDIC members visit www.cdic.ca.
The second step is to determine what types of savings CDIC protects. CDIC calculates deposit insurance payments separately (up to $100,000, including principal and interest) for each of the following: savings held in one name, savings held in trust, savings held in an RRSP, savings held in a RRIF, savings held for paying realty taxes on mortgage payments, and savings held in more than one name (joint deposits).
Keep in mind that there are some savings CDIC does not insure - for example, savings held in U.S. dollars or other foreign currency. In addition, CDIC does not protect mutual funds, stocks, or GICs or other term deposits that mature in more than five years. CDIC deposit insurance does not protect against fraud, theft or scams.
You can find out more about what's covered and what's not online at www.cdic.ca, toll-free at 1-800-461-CDIC (2342) or ask where you bank or invest.